Iranian Supreme Leader Ayatollah Ali Khamenei has instructed the government to adopt an "economy of resistance" to confront Western sanctions over Tehran's controversial nuclear program.

Iranian state media quote Khamenei as saying that "by using the nation's full potential," the government should "break the illusions of the arrogant powers" that they can force Iran to back down on its positions.

He said an economy of resistance is "the only way to pursue progress in the country."

Khamenei did not specifically mention sanctions or Iran's nuclear program.

His comments come after several Iranian officials, who had long downplayed the effect of the punitive measures, acknowledged in recent weeks that U.S. and EU oil and financial sanctions have harmed the economy.